Question

Based on 2017 sales, the six top-selling compact cars are the Honda Civic, Toyota Corolla, Nissan Sentra, Hyundai Elantra, Chevrolet Cruze, and Ford Focus (New York Daily News). The 2017 market shares are Honda Civic 20%, Toyota Corolla 17%, Nissan Sentra 12%, Hyundai Elantra 10%, Chevrolet Cruze 10%, and Ford Focus 8%, with other small car models comprising the remaining 23%. A sample of 400 compact car sales in Chicago showed the following number of vehicles sold.

Honda Civic 98
Toyota Corolla 72
Nissan Sentra 54
Hyundai Elantra 44
Chevrolet Cruze 42
Ford Focus 25
Others 65
Use a goodness of fit test to determine whether the sample data indicate that the market shares for cars in Chicago are different than the market shares suggested by nationwide 2017 sales. Using a 0.05 level of significance, what is the p-value?
The p-value is ___________.
What is your conclusion?
Conclude that the markets shares for the five compact cars in Chicago ______________the market shares reported.
What market share differences, if any, exist in Chicago? Round your answers to three decimal places. Enter negative values as negative numbers.
Sample
Compact Car Market Share Hypothesized Market Share Difference
Honda Civic - 0.20 =
Toyota Corolla - 0.17 =
Nissan Sentra - 0.12 =
Hyundai Elantra - 0.10 =
Chevrolet Cruze - 0.10 =
Ford Focus - 0.08 =
Others - 0.23 =

Answer 1

Pvalue = 0.020335

X² = 14.99

CONCLUSION: THERE IS DIFFERENCE IN MARKET SHARES

Explanation:

H0 : there is no difference in market shares

H1: there is difference in market shares

Chisquare (X²) = (observed - Expected)²/ expected

Honda Civic - 0.20 * 400 = 80 : (98-80)^2 /80 = 4.05

Toyota Corolla - 0.17 * 400 = 68 : (72-68)²/68 = 0.235

Nissan Sentra - 0.12 * 400 = 48 : (54-48)²/48 = 0.75

Hyundai Elantra - 0.10 *400 = 40 : (44-40)²/40 = 0.4

Chevrolet Cruze - 0.10 * 400 = 40 : (42-40)²/40 = 0.1

Ford Focus - 0.08 * 400 = 32 : (25-32)²/32 = 1.531

Others - 0.23 * 400 = 92 : (65-92)²/92 = 7.924

X² = (4.05+0.235+0.75+0.4+0.1+1.531+7.924) = 14.99

The obtain the Pvalue ;

We use the Pvalue from Chisquare calculator :

Pvalue(14.99, 0.05, df= 6) = 0.020335

Decision region :

Reject H0 ; if Pvalue < α

THERE IS DIFFERENCE IN MARKET SHARES

Market share differences:

* 98/400 = 0.245,

0.245-0.20 = 0.045

* 72/400 = 0.18,

0.18 - 0.17 = 0.01

* 54/400 = 0.135,

0.135 - 0.12 = 0.015

* 44/400 = 0.11,

0.11 - 0.10 = 0.01

* 42/400 = 0.105

0.105 - 0.10 = 0.005

* 25/400 = 0.0625

0.0625-0.08 = -0.0175

* 65/400 = 0.1625

0.1625 - 0.23 = -0.0675